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Otis Worldwide: Can Its Service-First Strategy Offset Weakness in China’s New Equipment Market?

Otis Worldwide Corporation reported a solid fourth quarter performance for 2025, marking its fifth year as an independent company. The company highlighted several strategic successes and faced a few challenges in its latest earnings call. On the positive side, Otis achieved record modernization orders and an unprecedented backlog, showcasing robust demand in its service-driven business model. The company reported record adjusted free cash flow of $817 million in the fourth quarter and an impressive $1.6 billion for the full year. This was attributed to focused efforts on working capital efficiencies and robust collections. In addition, Otis’ largest maintenance portfolio grew by 4% for the 14th consecutive quarter, emphasizing the effectiveness of its service strategy. The quarter also saw modernization orders increase by a striking 43%, ending with the highest backlog level since the company’s spin-off, positioning it well for future growth.